U.S. companies are scaling back investment plans at the fastest pace since the recession, signaling more trouble for the economic recovery.

Half of the nation's 40 biggest publicly traded corporate spenders have announced plans to curtail capital expenditures this year or next, according to a review by The Wall Street Journal of securities filings and conference calls.

Nationwide, business investment in equipment and softwarea measure of economic vitality in the corporate sectorstalled in the third quarter for the first time since early 2009. Corporate investment in new buildings has declined.

At the same time, exports are slowing or falling to such critical markets as China and the euro zone as the global economy downshifts, creating another drag on firms' expansion plans.

Corporate executives say they are slowing or delaying big projects to protect profits amid easing demand and rising uncertainty. Uncertainty around the U.S. elections and federal budget policies also appear among the factors driving the investment pullback since midyear.

NEW YORK (Reuters) - Dow Chemical Co, the largest chemical maker in the United States, said on Tuesday it plans to cut 5 percent of its workforce and shutter 20 plants as part of a restructuring program aimed at countering a slowing global economy.

Dow and other chemical companies face slipping demand for products around the world. Rival DuPont slashed its earnings forecast and announced 1,500 job cuts.

“The reality is we are operating in a slow-growth environment in the near-term and, while these actions are difficult, they demonstrate our resolve to tightly manage operations...” Andrew Liveris, Dow’s chairman and chief executive, said in a statement.

The company, which hopes to save $500 million a year, said the cuts would result in a loss of around 2,400 positions worldwide.

Among its planned plant closings, Dow will shutter a high density polyethylene facility in Belgium, a sodium borhidrate plant in the Netherlands, and a manufacturing facility in Midland, Michigan.

The company will also take an unspecified charge related to its Dow Kokam LLC assets, reflecting weak demand for lithium-ion batteries.

Dow said it would pare capital spending and investment in programs that are no longer a priority. It said those cuts should save it an additional $500 million.

The company will take fourth-quarter charges of around 50 cents to 60 cents per share for asset impairments and write-offs, severance and other costs related to the measures.

Dow had initially planned to release its restructuring plans along with its third-quarter earnings on Thursday, but the news was inadvertently sent to a reporter at the Bloomberg News, according to a source on Dow’s board of directors.

As a result, the company reported third-quarter earnings late on Tuesday and said it would hold a conference call on the results on Wednesday at 9 a.m. ET.

That compared with a profit of $815 million, or 69 cents per share in the same quarter last year, or adjusted earnings of $729 million, or 62 cents per share.

Sales were $13.6 billion, down 10 percent, or 7 percent on an adjusted basis. The decline was led by Europe where sales fell 10 percent, also hit by adverse exchange rates.

Analysts, on average, were expecting Dow to earn 37 cents a share, excluding items, on sales of $14.22 billion, according to Thomson Reuters I/B/E/S.

Shares of Dow fell 20 cents to $28.55 after the close of regular trading. The stock fell 4 percent in New York Stock Exchange trading.

(Additional reporting by Sakthi Prasad and Garima Goel in Bangalore, Michael Erman in New York, Braden Reddall in San Francisco, and Nichola Groom in Los Angeles; Writing by Anna Driver in Houston; Editing by David Gregorio and Chris Gallagher)

4
posted on 11/19/2012 10:25:31 AM PST
by buffyt
(Abortion is murder. It is not a Choice - It is a Child.)

I see today that Paul Krugman is advocating tax rates of 91%. I say, why stop there? Let's go full Stalin. Let's demonize the rich in Krugman’s paper with the full support and backing of the Barry WH. Throw some anti-semitism in there too. Let's take everything they have. And send the lucky ones to reeducation camps.

Krugman left out the other side of the story.
Back when there was a 91% bracket, there were a huge pile of deductions so that the money subjected to the 91% was very small. Today all those deductions are gone thanks to the dimrats. And still he thinks that taxing producers at 91% would work. It might the first year, but after that the producers would quit producing.

“Second Term Obama inherited a terrible economy from First Term Obama.”

Yes, I can’t wait for Obama to lambaste the clown who handed him the current mess. That clown promised to stop the rising of the oceans, among other grandiose pledges that were flagrantly ignored (if you earn less than $200K your taxes will not go up by ONE DIME!). Sad too that this bozo didn’t focus like a laser beam on the economy as he had promised. But, as they say, elections have consequences. Americans made their choice: now they have to live with it.

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